Hornbill Unleashed

October 22, 2016

Property valuers unhappy with Budget 2017 for not reinstating DIBS

Filed under: Politics — Hornbill Unleashed @ 9:01 PM

Prime Minister Datuk Seri Najib Razak is pictured tabling Budget 2017 before Parliament on October 21, 2016. — Picture by Yusof Mat IsaProperty valuers criticised today Budget 2017 for failing to address the slowdown in the property market.

House buyers, however, rejoiced over the federal budget announced today, lauding Prime Minister Datuk Seri Najib Razak for not heeding calls from developers to relax cooling measures previously introduced to stem excessive speculation on house prices.

“We had expected that 2017 Budget to come up with the following measures ― to re-introduce DIBS for first time buyers only and confine the purchase of the house up to RM400,000 and impose conditions of penalty if they sell the property within five years to prevent speculation; all the government departments/ agencies and GLCs to come out with a plan to identify their surplus lands for joint ventures with developers to build affordable housing,” the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector (PEPS) said in a statement.

DIBS refers to the Developer Interest Bearing Scheme that allows buyers not to service their loans throughout the construction period as it is is borne by developers instead.

PEPS said its proposal would have substantially brought down land cost for developers and assisted in the monetisation of government land-bank assets.

PEPS also called on Putrajaya to formulate proper incentives for housing developers, in order to aid them in building prefabricated houses and to implement the Industrial Building System (IBS).

They demanded more incentives for those who build affordable housing to rent and urged the Employees Provident Fund (EPF) to allocate more funds under account two for first-time buyers, as a top-up loan for their deposits.

The National House Buyers Association (NBA) lauded Najib’s announcement of a full waiver of stamp duty for first-time home buyers involving houses costing a maximum of RM300,000, from the current rate of 50 per cent.

They also welcomed other measures announced in Budget 2017, including the levy of stamping duties of four per cent on properties in excess of RM1 million, a maximum special loan scheme of between 90 per cent and 100 per cent from participating banks for first time house buyers, and the construction of 10,000 homes for rent for young working adults.

“Developers, [being] profit driven, merely want to sell their products by whatever means, even recommended DIBS for ‘first time house buyers’ on the guise of ‘assisting them’. We are glad that the developers’ trade organisation did not succeed to mindset the government to be their sales agent.

“HBA is grateful that the government has taken the initiative to build more affordable housing.  However, HBA cautions that the right implementation to ensure that the said affordable housing reaches the right target market,” HBA said.

The group added that the homes must be priced between RM150,000 and RM300,000, not exceed RM300,000 for homes in prime locations, and that these homes must be strictly reserved for first-time home buyers, unlike the PR1MA.

HBA also cautioned the government that the special loan scheme between 90 and 100 pr cent from banks cannot be implemented across the board.

“This is because some first time house buyers may have existing loan obligations and if they were given a 90 per cent to 100 per cent loan, the combined loan repayments could be too burdensome leading to an imminent default in a matter of time.

“As such, HBA feels that the decision of how much financing to extend must rest with the respective Banks and this proposal should only be a general advisory and cannot be made mandatory,” HBA added.

Source : The Malay Mail Online


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